Tackling Economic Challenges for the Indian Government


Citizen protests across the country over the Citizens Amendment Act, coupled with the proposal to implement the controversial National Register of Citizens, has kept the media and masses distracted from pressing economic issues.  In 2019, when the NDA government was voted back to power with a thumping majority, commentators had presented Prime Minister Modi as India’s best-chance for economic reform.  This positivity was largely based on the track record of PM Modi’s first term, which focused on economic reforms including the passing of the much debated GST law, deregulation of fuel pricing, and implementation of bankruptcy laws.  However, six months into its second innings, the current government has come in for a fair amount of criticism for its handling of the economy.  Modi government’s first Chief Economic Advisor Arvind Subramanian recently described the economy as heading for the intensive care unit.

If I had to focus on one issue that the government needs to tackle urgently, it is job creation. A leaked NSSO survey revealed unemployment levels were at a 45-year high 6.1% in 2018.  Some economic policies like demonetization, also led to huge job losses (50 lakh, per a Azim Premiji University report).  The government needs to focus on the manufacturing sector in order to give impetus to job creation.  Support to micro, small, and medium industry through skilling programs for youth, and provision of credit and loans is another way of creating more jobs.  

In a splintered voter base like ours, it is rare to get a mandate like the one that the Modi government received in 2019.  A focus on economic reforms will allow the government a better chance of attaining a challenging, self-stated goal of becoming a $5 trillion economy.

(This blog post is part of an academic exercise)

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